WASHINGTON (CNN) -- After being dogged by heavy criticism over questionable intelligence on Iraq and terrorism since the September 11, 2001 attacks, George Tenet resigned Thursday as the director of the CIA.

"I tell you about my plans to depart with sadness, but with head held very, very high," Tenet told CIA employees at the agency's Langley, Virginia, headquarters.

"And while Washington and the media will put many different faces on the decision, it was a personal decision, and had only one basis -- in fact, the well-being of my wonderful family -- nothing more and nothing less."

The first word of Tenet's resignation came from President Bush a few hours earlier when he talked to reporters after meeting with Australian Prime Minister John Howard.

"George Tenet is the kind of public servant you like to work with," Bush told reporters at the White House.

"He's strong, he's resolute. He's served his nation as the director for seven years. He has been a strong and able leader at the agency. He's been a strong leader in the war on terror, and I will miss him."On the Scene: CNN's David Ensor on the resignation

The announcement seemed to take much of Washington by surprise. House Speaker Dennis Hastert and House Minority Leader Nancy Pelosi both said they had no advance notice of Tenet's departure.

Tenet said his resignation will be effective July 11 -- the seventh anniversary of his 1997 appointment by then-President Bill Clinton.

During Tenet's time in office, he led the CIA through the 1999 conflict in Kosovo, the al Qaeda terror attacks on New York, Virginia and rural Pennsylvania, and the wars in Afghanistan and in Iraq. Tenet has enjoyed a lifetime of public service

In his remarks to employees, he praised the agency's "magnificent work" -- but he added, "Our record is not without flaws."

"The world of intelligence is a uniquely human endeavor, and as in all human endeavors we all understand the need to always do better," Tenet said. "We are not perfect, but one of our best-kept secrets is that we are very, very, very good."

Another key CIA official, James Pavitt -- the CIA's deputy director of operations who oversees all covert operations -- plans to announce his resignation Friday, U.S. sources told CNN Thursday.

The sources said Pavitt's resignation is "entirely unrelated" to Tenet's -- that Pavitt's plan to resign has been in the works for three to four weeks.

Pavitt, who has spent 30 years in the intelligence business, including the last five years as the CIA's deputy director of operations, testified before the 9/11 commission in mid-April. It marked the first time in the agency's history that someone of his position testified publicly.

'He's being pushed out or made a scapegoat'

Tenet has faced sharp criticism over the September 11 terror attacks and the war in Iraq, where pre-invasion U.S. estimates that Iraq was amassing stockpiles of weapons of mass destruction now appear to have been incorrect.

Several key lawmakers -- including Sen. John Kerry, the presumptive Democratic presidential nominee -- have called for his resignation, and coming reports are expected to call for sweeping changes in the intelligence community.

Kerry released a statement saying he wished Tenet "the very best," but said the Bush administration has to take responsibility for "significant intelligence failures."

"Sometimes with change comes opportunity," Kerry said. "This is an opportunity for the president to lead. As I've said for some time, we must reshape our intelligence community for the 21st century and create a new position of director of national intelligence with real control of all intelligence personnel and budgets."

Sen. Richard Shelby, a former Intelligence Committee chairman, said Tenet's decision to step down as director of central intelligence was "long overdue."

"There were more failures of intelligence on his watch as director of the CIA than any other [director of Central Intelligence] in our history," Shelby, R-Alabama, said in a written statement. "I have long felt that, while an honorable man, he lacked the critical leadership necessary for our intelligence community to effectively operate, particularly in the post-9/11 world."

But the current chairman and the ranking Democrat on the Senate Intelligence Committee issued a joint statement praising Tenet, saying he "provided much-needed stability and leadership to an agency that was largely adrift."

"While he steps down during a period of controversy over events leading up to the attacks of 9/11 and the quality of intelligence prior to the Iraq war, we should not lose sight of a simple truth: George Tenet has served his country with distinction and honor during difficult and demanding times," said Sens. Pat Roberts, R-Kansas, and Jay Rockefeller, D-West Virginia.

And Hastert, R-Illinois, said Tenet "always did his best to defend this nation against terrorists and those states that support them."

Bush made the Tenet announcement before boarding Marine One for a flight to Andrews Air Force Base in Maryland.

He is on his way to Europe, where he will attend ceremonies marking the 60th anniversary of the D-Day invasion in World War II. (Bush leaves for European trip)

A White House official said Bush would have liked Tenet to stay on, and denied that his departure was "worked out beforehand" or "engineered."

"Tenet told Bush he wanted to leave for personal reasons, and once he said that, Bush said he respected that," the official said.

But former CIA Director Stansfield Turner said the timing of Tenet's resignation -- just five months before the presidential election -- cast doubt on the explanation that it was a personal decision.

"I think he's being pushed out or made a scapegoat," said Turner, who led the CIA during the Carter administration. "That is, that the president feels he's got to have somebody to blame, and he's doing it indirectly by asking Tenet to leave. ... I don't think he would pull the plug on President Bush in the middle of an election cycle without having been asked by the president to do that."

Rep. Porter Goss, chairman of the House Intelligence Committee, said of Tenet: "Boatloads of stuff have been dumped on him by all kinds of people," but "I don't think you can fault the man."

Tenet's standing ovation

"This is the most difficult decision I have ever had to make," Tenet told CIA employees.

Tenet's remarks won a lengthy standing ovation from agency workers in what one source described as a "rock concert" atmosphere. Tenet has been popular among the agency's rank-and-file, and his speech was interrupted by frequent applause. (Transcript)

Introducing his boss, an emotional McLaughlin told CIA staff that "It's a hard day for all of us."

Tenet said he is stepping down in part to spend more time with his son.

"I'm going to be a senior with him in high school," Tenet said. "We're going to go to class together. We're going to party together. I'm going to learn how to instant message his friends -- that would be an achievement."

Tenet praised his agency's "magnificent work" in the battle against al Qaeda, its support for U.S. troops in Iraq, and its successes against drug traffic and weapons proliferation.

But he added, "Our record is not without flaws."

"The world of intelligence is a uniquely human endeavor, and as in all human endeavors we all understand the need to always do better," Tenet said.

Pelosi said her confidence in Tenet's judgment had never wavered, even though the CIA chief was in a "very difficult situation."

"I think there are many more people who are responsible for the mess that the Bush administration has gotten us into," she told reporters. "But if Mr. Tenet thinks there should be a change of leadership at the Central Intelligence Agency -- for whatever reason, including taking one for the administration -- then so be it."

Recent testimony

Tenet sits behind Secretary of State Colin Powell during the secretary's testimony to the U.N. Security Council about Iraq.

In April, the panel investigating the September 11 attacks criticized the intelligence community and faulted Tenet for not having a management strategy to battle terrorism before the 9/11 attacks.

Tenet told the panel that enormous progress had been made since the attacks, but said that the intelligence community would need "another five years to have the kind of clandestine service our country needs." (9/11 commission faults U.S. intelligence)

In February, Tenet defended his agency's prewar assessment of Iraq's military capabilities and denied allegations that the intelligence community overplayed the potential threat that Saddam Hussein had chemical or biological weapons. (Tenet defends prewar judgment on Iraq)

"[The CIA] painted an objective assessment for our policy-makers of a brutal dictator who was continuing his efforts to deceive and build programs that might constantly surprise us and threaten our interests," Tenet said in a speech at Georgetown University.

The supposed threat of large Iraqi stockpiles of weapons of mass destruction was the primary justification for the U.S.-led invasion of Iraq.

So far, only a few artillery shells believed to contain sarin and mustard gas have been recovered.

Tenet took responsibility for a later-discredited line in Bush's 2003 State of the Union address that alleged that Iraq was trying to buy uranium from Africa, saying the CIA had seen and approved the speech before it was delivered, and he took responsibility for the mistake.

The uranium claim was investigated by former Ambassador Joseph Wilson, who said he told the CIA the report appeared unsubstantiated.

After Wilson went public with his account last year, his wife's identity as a covert CIA operative specializing in weapons of mass destruction was leaked to columnist and CNN commentator Robert Novak. That disclosure is now the subject of a criminal investigation.

And Tenet sat behind Secretary of State Colin Powell during the secretary's February 2003 presentation to the U.N. Security Council, in which the United States accused Iraq of violating numerous U.N. resolutions requiring its disarmament.

Powell said last month that the sources of his allegations were "inaccurate and wrong and, in some cases, deliberately misleading. And for that I am disappointed, and I regret it."

Ahmed Chalabi, the one-time U.S. ally whose Iraqi National Congress has been accused of providing some of that inaccurate intelligence, blamed Tenet for providing "erroneous information" about Iraq's suspected weapons programs. (Full story)

Chalabi is under investigation for fraud and is suspected of passing U.S. intelligence secrets to Iran, but he says Tenet led a "smear campaign" against him.